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Kaesong Industrial Zone's Hidden Human Face

April 10, 2013 5:58 PM

Reuters

Visitors look at the industrial complex in Kaesong, North Korea, through binoculars at Dora Observation Post in the demilitarized zone (DMZ) near the border village of Panmunjom, in Paju, South Korea, April 9, 2013.

SEOUL —
The hidden human face of North Korea's decision to shutter an industrial park it ran with Seoul is its 53,000-strong workforce. At the Kaesong industrial zone, North Korean workers earned regular wages and formed bonds with their southern compatriots, even flirting once in a while.

North Korea's most skilled laborers have kept South Korean factories at the park humming for nearly a decade, at the same time putting food on the tables of an estimated 200,000 people in one of the world's poorest countries.

Kaesong was also the only place where people from the two Koreas mixed following the closure of a joint mountain resort in 2008 during an earlier bout of tension on the Korean peninsula.

As ties between the two Koreas worsened in the wake of Pyongyang's Feb. 12 nuclear test, some North Korean workers at Kaesong spoke about their fears for the future.

"We've talked with each other a bit," said Shin Dong-chul, a 55-year-old South Korean truck driver who last left Kaesong on March 30. "Although we didn't say a lot, they were also worried ... about their work."

Pyongyang suspended activity at Kaesong on Monday after barring access last week, all but closing down the last symbol of Korean cooperation. North Korea said no decision had been made on whether it would reopen the park, which lies on the outskirts of the city of Kaesong, just inside the country's heavily-fortified border with the South.

"Better Than Chinese Workers"

South Korean firms paid $130 a month for each worker to a North Korean state agency which then redistributed part of the cash in local currency and vouchers accepted at state-run stores.

A single North Korean worker at Kaesong was responsible for the livelihoods of three others, a South Korean government official said on condition of anonymity due to the tensions.

"That's 200,000 North Koreans that Kaesong was feeding," said the official.

North Korea has blamed the South for the suspension at Kaesong, but especially bristled at suggestions from Seoul it would keep the park running because of the money it brings in.

The 123 small and medium-sized firms in the zone churned out $2 billion a year in clothing, shoes and other goods.

One South Korean businessman whose firm has been at Kaesong since the park began shipments in 2004 said North Koreans were ideal workers because they were industrious and spoke Korean.

"We've operated in third countries before, but they are by far the best workers, much better than the Chinese," said the executive, who asked not to be identified because he was not authorized by the firm's owners to speak to the media.

South Korean made Choco-pie snacks were initially handed out by employers as incentive bonuses, creating a black market in Kaesong city where North Korean workers would trade them for cash.

Over the years those perks have grown to include instant noodles, sausages and on national holidays, boshing-tang, a spicy dog meat stew, or chicken, the South Korean official said.

Most workers would get to use the communal bath once a week, officials said, although sometimes things got a little hot.

One worker who left Kaesong last week recalled an incident where a South Korean man and a North Korean woman were seen leaving a quiet part of a factory together. The man was soon asked to leave the zone.

"If a South Korean worker flirts with a North Korean worker, he would be immediately kicked out," said the South Korean.

More normal was North Korean guards cadging cigarettes from their southern neighbors.

When Kaesong began shipping goods, it was touted as a symbol of reconciliation under the "Sunshine Policy" of former South Korean President Kim Dae-jung, who went to Pyongyang in 2000 to meet then North Korean leader Kim Jong-il.

In 2005, Shinwon Corporation, which makes mid-range clothing, even held a fashion show that stunned the North Korean workers who attended, according to those present. The show featured a young South Korean actress using a catwalk built on the second floor of the company's factory at the time.

And Cheaper

Visitors who cross the border travel five km (three miles) through a barren landscape before reaching the factory park, built by a subsidiary of South Korea's Hyundai conglomerate and North Korea's state-run Land & Housing Corporation.

Hyundai-built buses take North Koreans to the park, which occupies 3.3 million square meters on the outskirts of Kaesong city, once the seat of an ancient Korean dynasty. For centuries, the Kaesong region prospered as a commercial center, with Pyongyang 160 km (100 miles) to the north and Seoul 60 km (38 miles) to the south and rich farmland to the west.

The zone is powered by electricity from across the border and fuel trucked in from the South.

When it opened, many companies were attracted by the promise of skilled labor at a fraction of the wages in South Korea.

"We applied to be one of the 15 companies going into Kaesong in 2004," an official at an apparel maker said, requesting anonymity. "We had some trade experience with North Korea in the 1990s and knew North Korean workers had excellent manual skills, so we were looking for an opportunity to go in."

Women were preferred because they were seen as more productive, friendlier and paid more attention to detail, said another South Korean official who was involved in setting up the project.

"And the women seemed to genuinely like working there," the official said.

The project was also regarded as a test bed for the eventual reunification of the two Koreas, where the capitalist South would rescue the North's broken economy.

"We have the discipline, the intelligence and the will," a North Korean official told visiting journalists in the late 2000s as the two sides were planning to link their railways, another project of the Sunshine era that has gone nowhere. All that was needed, he said, was for the wealthy South to invest.